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Nokia – disconnecting from people

Manish Sharma

Pic source: Toonpool.com

Finnish telecom handset giant Nokia, which not very long ago was enjoying the monopoly over the Indian mobile handset market, has fallen off the clip, and how!

The latest report by IDC India, an IT research firm, has estimated that the market share of Nokia has alarmingly shrunk to 36 per cent this July vis-à-vis 54 per cent last year. Though Nokia has refuted the findings, alleging that the exports figure from its Chennai plant have not been taken into account but it is a reality that Nokia has taken a beating in consumer confidence over the past few years due to which its market share has been eroding continuously.

It is interesting to note that the case of Nokia is not very different from the two other monopolists – LIC and Maruti Suzuki. Both of them have had a market share close to 90 per cent when the competition caught up with them. However, unlike Nokia that failed to respond to the changing market dynamics, both LIC and Maruti showed amazing alacrity and came up with nimble footed response to manage its leadership position. They are still controlling close to 60 per cent share in the territories that matter most – Maruti still dominates the compact car segment and LIC still being the favourite of the ubiquitous middle class when it comes to new premiums.

From their success Nokia can really believe that it can recover the lost territory if it acts swiftly with its rearguard action. What it can do?

Showcase your strength: Maruti has been harping about its massive service network. In fact, one of its memorable commercial showed two lost tourists in Laddakh who did not get food and water but got surprised to find a Maruti Network in the Himalayas. Point is you need to speak about your strengths in your communication. Maruti has also managed to generate word of mouth publicity targeted at first time buyers that they will get a better re-sale value for their cars. Similarly, LIC also boasts of the massive agent distribution network unmatched by its peers so far. Moreover, the quasi judicial nature of its existence has so far been perfectly exploited.

Stay ahead: Maruti has not rested on the laurels of the success of either 800 or its current best selling model Alto. It has kept the competition on its toes with its tactics to unveil new models each year. While its detractors have slammed the strategy to crowd the space of compact car segment, its rising market share has proved them wrong. In fact it has introduced as many as 5 cars – Zen, Wagon R, A-Star, Ritz and Swift in the sub-Rs 500,000 segment that contributes nearly 80 per cent volumes to the car industry. While, skeptics fear that each car will eat into the market share of others but it has kept the customers within Maruti stable by providing them with more opportunities and more models to choose form. LIC also kept its focus more on the unit linked insurance plans to provide higher returns to policyholders. The approach was on providing market-linked products rather endowments policies that have been the bread and butter of LIC.

Follow the trend: Maruti underwent a makeover by offering new designs with the launch of swift. Earlier, its cars had classic line designs be it Zen, Esteem or even Boleno. It changed track with the launch of Swift and adopted a sportier, muscular and aerodynamic approach for its designs. Maruti positioned itself as the car for today’s generation with its trendy look. Similarly, LIC too is focusing on youth brigade in its communication. The new commercials, though less appealing on aesthetics, are being made keeping in mind the demographic profile of below-30 age group. Today, youth is increasingly becoming aware of financial planning practices and hence LIC is trying to pose itself as a company that is aware of their aspirations and needs and hence capable of providing answers to their problems.   

It is obvious that Nokia has fared poorly in following the above mentioned dictum. It has almost got wiped off from the entry level segment. It did not pay any attention to the mid level segment for close to one year and did not care to launch any successful model when the market was asking for it. Samsung stole the thunder with the success of Corby in this segment. Then again its inability to successfully penetrate the market of Smart phone/Touch screen mobiles further turned away customers. On the marketing front, the strategy to rope in Shah Rukh as its brand ambassador too failed to evoke positive response.

May be a massive public relation campaign is the need of the hour than an array of endorsements. What do you think?

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